A provocative, unsponsored assessment of current and future legal, regulatory, marketplace, and cultural issues affecting telecommunications and information policy presented by Rob Frieden, Pioneers Chair and Professor of Telecommunications and Law, Penn State University

Thursday, July 31, 2008

Those wacky editorial writers at the Wall Street Journal just cannot seem to get the facts straight about network neutrality and what the FCC has done or can do on this matter. In the July 30, 2008 edition (Review and Outlook A14), the Journal vilifies FCC Chairman Kevin Martin for starting along the slippery slope of regulating Internet content.

The Journal writers just seem to love hyperbole, and are not beyond ignoring the facts when they do not support a party line. Here are a few examples from the editorial.

The editorial states that Chairman Martin wants to use a “set of principles” to punish Comcast for engaging in legitimate network management. Chairman Martin’s predecessor Republican Michael Powell drafted a Policy Statement and a Republican majority FCC approved them. See http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-260435A1.pdf.

The network management undertaken by Comcast involved masquerading as the recipient of a peer-to-peer (“P2P”) file transfer and issuing a command to reset, i.e., to stop sending traffic and start again. Comcast forged so-called TCP reset packets even though it appears that the company could have handled the actually occurring traffic volume without having to degrade anyone’s traffic.

The Journal editorial characterizes Comcast’s action as a technical dispute over network management apparently resolved when Comcast discussed P2P traffic management issues with BitTorrent one of many firms that create software used to send and receive P2P traffic. In a world of non-disclosure agreements, we have no sense of what the parties agreed to, and more importantly if Comcast will extend to other software providers and Comcast subscribers fairer network management terms and conditions.

One infers from the editorial that the FCC’s action amounts to overkill, but the FCC has not yet issued an order, much less announced a fine or other sort of punishment. Nevertheless, the upcoming decision apparently will start a regulatory regime ruining the Internet, because the FCC allegedly has leveraged a Policy Statement into the apparent resurrection of common carrier regulation resulting in “unprecedented control over how consumers use the web.”

The editorial claims that network neutrality advocates want the FCC to “prohibit Internet service providers from using price” to address “ever-growing” bandwidth demand and network management functions. I do not know of any network neutrality proponent who thinks the FCC should outlaw the practices of Akamai and other providers of “better than best efforts” traffic routing at premium prices. I did not hear of any network neutrality advocate argue against proposals by Time Warner and other Internet Service Providers (“ISPs”) to offer subscribers various tiers of service instead of a one size fits all, unmetered service.

What does trigger concern are undisclosed practices, unavailable to subscribers and content providers alike, that create artificial bottlenecks and congestion. If smart Enron traders could extract incredible wealth by manipulating the flow of electrons along a grid, what prevent Comcast and others from manipulating packets for similar gain?

I am at a lost to understand how the Wall Street Journal regularly attempts to pillory FCC Chairman Martin as itching to impose heavy-handed regulation. Despite the Journal’s penchant for alarmism, Chairman Martin has not abdicated his general free market advocacy. The Chairman realizes that ISPs cannot operate completely free of a rule enforcing referee. Nondisclosure agreements, and the lack any effective means to monitor performance creates conditions where ISPs have unprecedented opportunities to engage in practices that are characterized as necessary network management, but in reality serve a specific agenda, e.g., to punish heavy network users whether they be highly popular content sources, or consumers of P2P file transfers.

Rather than surreptitiously drop packets to degrade service, ISPs need to find ways to enhance heavy users’ Internet experience as Akamai does. The FCC has to act when an ISP decides to punish a heavy volume user that might cause congestion even though the ISP has yet to offer the heavy user premium service options.

About Me

Rob Frieden serves as Pioneers Chair and Professor of Telecommunications and Law at Penn State University.He also provides legal, management and market forecasting consultancy services and has written four books, most recently Winning the Silicon Sweepstakes: Can the United States Compete in Global Telecommunications published by Yale University Press. Rob has written over one hundred articles in law reviews and telecommunications policy journals and has provided commentary in a variety of trade periodicals. He updates a major communications treatise: All About Cable and Broadband (Law Journal Press).

Rob has held senior policy making positions in international telecommunications at the United States Federal Communications Commission and the National Telecommunications and Information Administration.In the private sector, he practiced law in Washington, D.C., and served as Assistant General Counsel at PTAT System, Inc. where he handled corporate, transactional and regulatory issues for the nation's first private undersea fiber optic cable company. Professor Frieden holds a B.A., with distinction, from the University of Pennsylvania (1977) and a J.D. from the University of Virginia (1980).